strategic management forum maintenance agreements equals

Strategic Management Forum

Maintenance Agreements Equals Monthly Residual Income

and Equity For Your Business

Facilitator: Heather D. Blease

Savi Systems

Facilitator: Heather D. Blease

Savi Systems

Instructor: Heather D. Blease Savi Systems

South Portland, Maine

Digital Equipment CorporationDesign Engineering, Mfg, Management

Envisionet Computer ServicesFounder, CEO, Chairman, $30M,

2500 employees, Venture Capital

ConsultantExecutive Mgmt, Custom Retail, Technology,

Financing

Savi SystemsSavi Integrated Systems, Savi Energy

INTRODUCTIONS

OBJECTIVES

1. Why a Service Maintenance Agreement?

2. Definition of Service Maintenance Agreement

3. Discussion of Service Maintenance Terms

4. Positioning and Selling Service Maintenance Agreements

5. Practice within a group

A G E N D A

I. Session Overview

II. Define our Learning Objectives

III. What is a Service / Maintenance Agreement?

IV. How to position, price and sell to the client

V. The Agreement

VI. Trying it together - working group lesson

VII. Questions and Answers

1. Recurring Revenue Stream & Customer Long-Term Satisfaction

A. Predictable

B. Reliability Guaranteed

C. Cash flow machine

D. Security, Cell phone company examples

E. Adds Value to Company (exit, financing)

F. Add Value to relationship with client – NOT A

BIG BOX EXPERIENCE; a relationship!

SERVICE MAINTENANCE AGREEMENTS – WHY?

A G E N D A

I. Session Overview




V. The Agreement



DEFINITION OF AN EXTENDED WARRANTY

I. feasibleII. iPod - Get the most from your iPod for two years from its original purchase date with the award-winning AppleCare Protection Plan. You get telephone

technical support from our experts for questions about using your iPod, and you get global repair coverage ﾑ both parts and labor ﾑ on your iPod, its battery,

and included accessories. iPod coverage: $59

Mac OS System - The AppleCare Premium Service and Support Plan covers both Xserve hardware and Mac OS X

Server software. Get up to three years of expert telephone and email support and onsite hardware service

to keep your Xserve system up and running. If you experience a problem, Apple technical support experts

are available 24 hours a day to help you determine if it's a hardware failure or a Mac OS X Server

configuration issue. In either case Apple's support staff will work to get your system up and running as

quickly as possible. And because Apple's hardware and software are uniquely integrated there's only one

AppleCare number to call.The AppleCare Premium Service and Support Plan delivers expert telephone and

email support with 30-minute response time--24 hours a day, seven days a week. The hardware repair

coverage ensures four-hour onsite response during business hours and next-day onsite response after

business hours (terms apply). Onsite response time and availability of onsite service depend on your

location. With the AppleCare Premium Service and Support Plan, you'll have the assurance that Apple-

authorized technicians will perform repairs using genuine Apple parts. MacIntosh OS Operating Sytstem

AppleCare coverage cost: $950

DEFINITION OF A SERVICE MAINTENANCE AGREEMENT

. . . It is not about the

equipment component repair.

…It is about the complete

experience when a problem does

occur.

THE WARRANTY COVERS THE EQUIPMENT;

THE MAINTENACE AGREEMENT COVERS THE

SYSTEM

WHY TIME AND MATERIALS DOES NOT WORK

. . . Not worth the

risk

WHAT DO CUSTOMERS REALLY WANT AND EXPECT?

I. Quick Responsive Service Time

II. No Budgetary surprises

III. Ease of purchase / under the radar

IV. Support without question or hesitation

V. Proactive service with quarterly visits

VI. Value meets their needs (7/24)

VII. Reduce Client Real Risk; perceived Risk

VIII. Instant Loaner

A G E N D A

I. Session Overview




V. The Agreement



DESIGNING THE CORRECT PACKAGE

I. The presentation package determines

mediocre or great results.

II. What’s in a name?

III. One plan or various packages?

IV. Existing Clients or New Client, how

to sell to both.

THE OFFER

1. The Presentation

Make a professional brochure that clearly outlines the different levels of coverage

Looks professional Adds credibility to the plans being

offered It empowers the client to make the right

choice for their budget and individual needs

2. Choices

VIPVIP

PreferredPreferred

StandardStandard

THE OFFER

3. One plan or various packages?

THE OFFER

CONSIDERATIONS

Preventive Maintenance and Support:(proactive and reactive service)

New Clients

Existing Clients

COMMISSION FOR PMA SALES

HAPPY CUSTOMERS = REFERRALS

A good reason to contact clients

Past, new big box failures, competitors

Instant revenue generation

Up-sell

PRICING CONSIDERATIONSPreventive Maintenance Agreement

New Clients (% OF SALE)

Existing Clients (Survey of client system, fixed $ annually or monthly, etc.)

PRICING ON LEGACY SYSTEMS

Algorithm for service on old jobs :

Age of install (A); plus number of foreign sports cars in garage (S); divided by Miles from Ocean (O); equals Rate (R)

A + S /O = R

PRICING LEGACY PREVENTIVE MAINTENANCE AGREEMENTS

Client Survey: Legacy PMA Checklist Account details

Client name Partner Phone number

Location Seasonal/Primary Call date

Sales Person Lead Source Call time

Purpose

Legacy PMA system information intake. The value - the peace of mind that the client’s equipment will be in our hands – capable, respectful, knowledgeable hands.

Their prized possession will perform better, and last longer with Savi‘s expertise.

Lifestyle Notes

Entertainment Interests: Technical Prowess/ Interest:

PRICING LEGACY PREVENTIVE MAINTENANCE AGREEMENTS

Client Survey:• Estimate hours

multiplied by labor rate

• Establish a minimum charge

• Collect $ Automatically -reoccurring revenue

• Upsell, upsell, upsell

System Automation Whole House Audio

Lighting Control Televisions

Pains Loves

New Technology?? Fears Recent Upgrades

A G E N D A

I. Session Overview




V. The Agreement



DESIGNING THE PACKAGE FOR NEW CLIENTS

New Clients -

I. Seamless integration. Installation and service is

one and the same.

II. Leverage key features and benefits to win sales.

III. Sales force integration via compensation incentives

IV. Not an option - essential element in the sale.

V. Use a matrix table to show the benefits and need.

VI. Make it easy to sign. Same contract document as the

sale.

PRESENT AND SELL THE FULL SERVICE PLAN

DESIGNING THE PACKAGE FOR EXISTING CLIENTS

Existing Clients

I. Research what they pay for T and M service calls.

II. Raise your rates for T and M service.

III. SA must be shown that they offer a higher level of service.

IV. Create awareness.

V. Develop a package.

VI. Personalized letter.

VII. Respond by a specific date - call to action, sense of urgency, expiration of

offer.

VIII. Must provide and clearly show value.

IX. Use matrix table to show financial and emotional benefits.

X. Telephone call follow up to the letter invitation. Big accounts a face to face

meeting.

XI. Test market with key accounts.

Send a letter to your past clients offering the maintenance service packages -

This works exceptionally well with past clients that have had T&M service calls.

Follow up with a personal phone call to discuss the letter and plan options.

Make more than one call if you don’t make contact the first try.

CREATE A BASIC AGREEMENT

Keep it simple and short.

Clearly outline the services, performance guarantees, and limitations to the maintenance agreement.

CREATE A BASIC AGREEMENT

Make sure you can deliver what you promise.

A G E N D A

I. Session Overview




V. The Agreement



WORKING GROUP: CREATE AN AGREEMENT THAT SELLS

15-minute Collaboration

Each Share 3 service/maintenance topics that are working

well in your company

Each Share 3 issues that present challenges within or

preventing the rollout of Service/Maintenance

Agreements

Select group’s top three in Working Well and Challenged

Categories.

Discuss Resolutions to Challenges

One spokesperson to share with Class

QUESTIONS?

Thank you for attending!

Please complete the course evaluation!

Heather D. Blease

[email protected]

207-841-3446 (cell)

207-774-2010 (office)